S&P affirms McAfee facilities

S&P said it affirmed all issue-level ratings on McAfee LLC's proposed credit facilities in light of the announced $500 million downsizing of the transaction.

The issue-level rating on the firm's first-lien credit facilities is B with a 3 recovery rating, indicating expectations for meaningful recovery (50%-70%; rounded estimate: 65%) of principal in the event of a payment default.

The issue-level rating on the firm's second-lien credit facilities is B- with a 5 recovery rating, indicating expectations for modest recovery (10%-30%; rounded estimate: 15%) of principal in the event of a payment default.

S&P said the B corporate credit rating is based on the firm's considerably high leverage, weak profit margins for a software vendor with over $2 billion in revenue and challenging industry dynamics in core endpoint security products.

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